Light Crude Oil CL futures recently redefine the definition of "buying low" via showing you can go lower than the low...below zero...into negative territory. wrbtrader
I don't have the crystal ball, don't know what the boy'z are going to do, don't know what dozu is going to do either. Back in mid March when stocks like ABBV was @ $63, PE=12, dividend=7.5%, I just couldn't resist. Bought some more GILD call options too. I think at the time the market was throwing the baby out with the bath water. As for what I am going to do now? GILD options are easy, they will expire and whatever will be will be at expiration. ABBV, I don't know, what would you do if you are, for example, holding something that pays 7.5%?
It depends on the time horizon. As a short term trader I don't give a s**t about dividends, but something longer term might be a good hold...ABBV does sound pretty good. This is going to be a crazy market for quite awhile in my opinion. I don't think all the bad news has come out yet. The fed can throw all the money it wants at the market and that will obviously help, but the markets might get surprised by how many companies go bankrupt down the road...possibly higher inflation later too. That's a bad combination...bankruptcies and inflation. Even before the virus I thought there were too many 'zombie companies' out there. Companies that shouldn't be in business, but they could continue getting bailed out by artificially low rates. Just think how this virus makes matters even worse. We might see the market rip higher and then crash again so many times it makes your head spin. So, it's up to you how you want to play this game...holding positions for the long term might be difficult...watching the extreme ups and downs. Good luck.
ignore the dividends, you get a better upside in quality (less than 1% dividend) or non-dividend stocks, such as AMZN, GOOG, FB, BRK-B, MA & others. When a company doesn't have to drain cash from its coffers, more money for a internal company building of it's business & shareholders, along with potential upside. take BRK-B 10%/yr growth, buy the stock, bolt on covered call options. if I'm looking for growth, it's non-dividend quality stocks .... no not penny stocks long term I like the 3X TQQQ, UPRO, UDOW Idiot proof ... https://www.splithistory.com/tqqq/, add in long OTM calls, how could 12%/yr not be achieved.
I agree with you about short term trades. I don't pay attention to dividends when I trade options but do when I hold underlying long term. In my trading account a big part of my positions are buy and hold long term with the rest in cash/options combined. March 2020 was really really bad for my buy and hold. Fortunately the short term option trades helped me out. This market is great for short term traders like you. Regards,
Agree with you 100% except I couldn't resist a 7.5% dividend. That is my fatal flaw, I have no discipline probably shouldn't have done it.